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Oct 2013 proposed bill against patent trolls

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Oct 2013 proposed bill against patent trolls

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									            F:\SLW\SLW_078.XML




                                                                                               .....................................................................
                                                                                                         (Original Signature of Member)



                                                                       H. R. ll
                                113TH CONGRESS
                                   1ST SESSION


                                To amend title 35, United States Code, and the Leahy-Smith America Invents
                                Act to make improvements and technical corrections, and for other purposes.




                                              IN THE HOUSE OF REPRESENTATIVES

                                Mr. GOODLATTE (for himself, Mr. DEFAZIO, Mr. COBLE, Ms. LOFGREN, Mr.
                                    SMITH of Texas, Ms. ESHOO, Mr. CHAFFETZ, Mr. BACHUS, Mr. MARINO,
                                    Mr. FARENTHOLD, and Mr. HOLDING) introduced the following bill;
                                    which     was       referred    to      the     Committee     on
                                    lllllllllllllll




                                                                          A BILL
                                To amend title 35, United States Code, and the Leahy-
                                   Smith America Invents Act to make improvements and
                                   technical corrections, and for other purposes.

                                  1               Be it enacted by the Senate and House of Representa-
                                  2 tives of the United States of America in Congress assembled,
                                  3        SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

                                  4               (a) SHORT TITLE.—This Act may be cited as the
                                  5 ‘‘Innovation Act’’.
                                  6               (b) TABLE           OF       CONTENTS.—The table of contents for
                                  7 this Act is as follows:
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                                                                                           2
                                           Sec.   1. Short title; table of contents.
                                           Sec.   2. Definitions.
                                           Sec.   3. Patent infringement actions.
                                           Sec.   4. Transparency of patent ownership.
                                           Sec.   5. Customer-suit exception.
                                           Sec.   6. Procedures and practices to implement and recommendations to the Ju-
                                                               dicial Conference.
                                           Sec.   7. Small business education, outreach, and information access.
                                           Sec.   8. Studies on patent transactions, quality, and examination.
                                           Sec.   9. Improvements and technical corrections to the Leahy-Smith America In-
                                                               vents Act.
                                           Sec.   10. Effective date.

                                  1        SEC. 2. DEFINITIONS.

                                  2                In this Act:
                                  3                         (1) DIRECTOR.—The term ‘‘Director’’ means
                                  4                the Under Secretary of Commerce for Intellectual
                                  5                Property and Director of the United States Patent
                                  6                and Trademark Office.
                                  7                         (2) OFFICE.—The term ‘‘Office’’ means the
                                  8                United States Patent and Trademark Office.
                                  9        SEC. 3. PATENT INFRINGEMENT ACTIONS.

                                10                 (a) PLEADING REQUIREMENTS.—
                                11                          (1) AMENDMENT.—Chapter 29 of title 35,
                                12                 United States Code, is amended by inserting after
                                13                 section 281 the following:
                                14 ‘‘§ 281A. Pleading requirements for patent infringe-
                                15                              ment actions

                                16                 ‘‘(a) PLEADING REQUIREMENTS.—Except as pro-
                                17 vided in subsection (b), in a civil action in which a party
                                18 asserts a claim for relief arising under any Act of Con-
                                19 gress relating to patents, a party alleging infringement
                                20 shall include in the initial complaint, counterclaim, or
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                                                                                          3
                                  1 cross-claim for patent infringement, unless the informa-
                                  2 tion is not reasonably accessible to such party, the fol-
                                  3 lowing:
                                  4                        ‘‘(1) An identification of each patent allegedly
                                  5               infringed.
                                  6                        ‘‘(2) An identification of each claim of each pat-
                                  7               ent identified under paragraph (1) that is allegedly
                                  8               infringed.
                                  9                        ‘‘(3) For each claim identified under paragraph
                                10                (2), an identification of each accused apparatus,
                                11                product, feature, device, method, system, process,
                                12                function, act, service, or other instrumentality (re-
                                13                ferred to in this section as an ‘accused instrumen-
                                14                tality’) alleged to infringe the claim.
                                15                         ‘‘(4) For each accused instrumentality identi-
                                16                fied under paragraph (3), an identification with par-
                                17                ticularity, if known, of—
                                18                                 ‘‘(A) the name or model number of each
                                19                         accused instrumentality; or
                                20                                 ‘‘(B) if there is no name or model number,
                                21                         a description of each accused instrumentality
                                22                         that, when used, allegedly results in the prac-
                                23                         tice of the claimed invention.
                                24                         ‘‘(5) For each accused instrumentality identi-
                                25                fied under paragraph (3), an explanation of—


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                                                                                          4
                                  1                                ‘‘(A) where each element of each claim
                                  2                        identified under paragraph (2) is found within
                                  3                        the accused instrumentality;
                                  4                                ‘‘(B) whether each such element is in-
                                  5                        fringed literally or under the doctrine of equiva-
                                  6                        lents; and
                                  7                                ‘‘(C) with detailed specificity, how the
                                  8                        terms in each claim identified under paragraph
                                  9                        (2) correspond to the functionality of the ac-
                                10                         cused instrumentality.
                                11                         ‘‘(6) For each claim that is alleged to have been
                                12                infringed indirectly, a description of—
                                13                                 ‘‘(A) the direct infringement;
                                14                                 ‘‘(B) any person alleged to be a direct in-
                                15                         fringer known to the party alleging infringe-
                                16                         ment; and
                                17                                 ‘‘(C) the acts of the alleged indirect in-
                                18                         fringer that contribute to or are inducing the
                                19                         direct infringement.
                                20                         ‘‘(7) A description of the right of the party al-
                                21                leging infringement to assert each—
                                22                                 ‘‘(A) patent identified under paragraph
                                23                         (1); and
                                24                                 ‘‘(B) patent claim identified under para-
                                25                         graph (2).


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                                                                                          5
                                  1                        ‘‘(8) A description of the principal business of
                                  2               the party alleging infringement.
                                  3                        ‘‘(9) A list of each complaint filed, of which the
                                  4               party alleging infringement has knowledge, that as-
                                  5               serts or asserted any of the patents identified under
                                  6               paragraph (1).
                                  7                        ‘‘(10) For each patent identified under para-
                                  8               graph (1), whether such patent has been specifically
                                  9               declared as essential, potentially essential, or having
                                10                potential to become essential to any standard-setting
                                11                body, and whether the United States Government or
                                12                a foreign government has imposed specific licensing
                                13                requirements with respect to such patent.
                                14                ‘‘(b) INFORMATION NOT READILY ACCESSIBLE.—A
                                15 party required to disclose the information described under
                                16 subsection (a) shall include with such disclosure a descrip-
                                17 tion of any information described under subsection (a)
                                18 that is not disclosed, why such undisclosed information
                                19 was not readily accessible, and the efforts made by such
                                20 party to access such undisclosed information.
                                21                ‘‘(c) CONFIDENTIAL INFORMATION.—For good cause
                                22 shown by a party required to disclose the information de-
                                23 scribed under subsection (a), the court may allow certain
                                24 information that the court determines to be confidential
                                25 to be filed under seal.


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                                                                                          6
                                  1               ‘‘(d) EXEMPTION.—A civil action that includes a
                                  2 claim for relief arising under section 271(e)(2) shall not
                                  3 be subject to the requirements of subsection (a).’’.
                                  4                        (2) CONFORMING                     AMENDMENT.—The                   table of
                                  5               sections for chapter 29 of title 35, United States
                                  6               Code, is amended by inserting after the item relating
                                  7               to section 281 the following new item:
                                               ‘‘281A. Pleading requirements for patent infringement actions.’’.

                                  8               (b) FEES AND OTHER EXPENSES.—
                                  9                        (1) AMENDMENT.—Section 285 of title 35,
                                10                United States Code, is amended to read as follows:
                                11 ‘‘§ 285. Fees and other expenses
                                12                ‘‘(a) AWARD.—The court shall award, to a prevailing
                                13 party, reasonable fees and other expenses incurred by that
                                14 party in connection with a civil action in which any party
                                15 asserts a claim for relief arising under any Act of Con-
                                16 gress relating to patents, unless the court finds that the
                                17 position of the nonprevailing party or parties was substan-
                                18 tially justified or that special circumstances make an
                                19 award unjust.
                                20                ‘‘(b) RECOVERY.—If a nonprevailing party is unable
                                21 to pay reasonable fees and other expenses awarded by the
                                22 court pursuant to subsection (a), the court may make the
                                23 reasonable fees and other expenses recoverable against any
                                24 interested party joined pursuant to section 299(d).


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                                                                                          7
                                  1               ‘‘(c) COVENANT NOT                      TO    SUE.—A party to a civil ac-
                                  2 tion that asserts a claim for relief arising under any Act
                                  3 of Congress relating to patents against another party, and
                                  4 that subsequently unilaterally extends to such other party
                                  5 a covenant not to sue for infringement with respect to the
                                  6 patent or patents at issue, shall be deemed to be a nonpre-
                                  7 vailing party (and the other party the prevailing party)
                                  8 for purposes of this section, unless the party asserting
                                  9 such claim would have been entitled, at the time that such
                                10 covenant was extended, to voluntarily dismiss the action
                                11 or claim without a court order under Rule 41 of the Fed-
                                12 eral Rules of Civil Procedure.’’.
                                13                         (2) CONFORMING                      AMENDMENT AND AMEND-

                                14                MENT.—

                                15                                 (A) CONFORMING                     AMENDMENT.—The                 item
                                16                         relating to section 285 of the table of sections
                                17                         for chapter 29 of title 35, United States Code,
                                18                         is amended to read as follows:
                                               ‘‘285. Fees and other expenses.’’.

                                19                                 (B) AMENDMENT.—Section 273 of title
                                20                         35, United States Code, is amended by striking
                                21                         subsections (f) and (g).
                                22                         (3) EFFECTIVE                  DATE.—The            amendments made
                                23                by this subsection shall take effect on the date of the
                                24                enactment of this Act and shall apply to any action
                                25                for which a complaint is filed on or after that date.
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                                                                                          8
                                  1               (c) JOINDER                  OF    INTERESTED PARTIES.—Section
                                  2 299 of title 35, United States Code, is amended by adding
                                  3 at the end the following new subsection:
                                  4               ‘‘(d) JOINDER OF INTERESTED PARTIES.—
                                  5                        ‘‘(1) JOINDER.—In a civil action arising under
                                  6               any Act of Congress relating to patents, the court
                                  7               shall grant a motion by a party defending against an
                                  8               allegation of infringement of a patent claim to join
                                  9               an interested party if such defending party shows
                                10                that the party alleging infringement has no substan-
                                11                tial interest in the patent or patents at issue other
                                12                than asserting such patent claim in litigation.
                                13                         ‘‘(2) LIMITATION                   ON JOINDER.—The               court may
                                14                deny a motion to join an interested party under
                                15                paragraph (1) if—
                                16                                 ‘‘(A) the interested party is not subject to
                                17                         service of process; or
                                18                                 ‘‘(B) joinder under paragraph (1) would
                                19                         deprive the court of subject matter jurisdiction
                                20                         or make venue improper.
                                21                         ‘‘(3) INTERESTED                     PARTY DEFINED.—In                     this
                                22                subsection, the term ‘interested party’ means a per-
                                23                son, other than the party alleging infringement,
                                24                that—




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                                                                                          9
                                  1                                ‘‘(A) is an assignee of the patent or pat-
                                  2                        ents at issue;
                                  3                                ‘‘(B) has a right, including a contingent
                                  4                        right, to enforce or sublicense the patent or pat-
                                  5                        ents at issue; or
                                  6                                ‘‘(C) has a direct financial interest in the
                                  7                        patent or patents at issue, including the right
                                  8                        to any part of an award of damages or any part
                                  9                        of licensing revenue, except that a person with
                                10                         a direct financial interest does not include—
                                11                                         ‘‘(i) an attorney or law firm providing
                                12                                 legal representation in the civil action de-
                                13                                 scribed in paragraph (1) if the sole basis
                                14                                 for the financial interest of the attorney or
                                15                                 law firm in the patent or patents at issue
                                16                                 arises from the attorney or law firm’s re-
                                17                                 ceipt of compensation reasonably related to
                                18                                 the provision of the legal representation; or
                                19                                         ‘‘(ii) a person whose sole financial in-
                                20                                 terest in the patent or patents at issue is
                                21                                 ownership of an equity interest in the
                                22                                 party alleging infringement, unless such
                                23                                 person also has the right or ability to influ-
                                24                                 ence, direct, or control the civil action.’’.
                                25                (d) DISCOVERY LIMITS.—


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                                                                                          10
                                  1                        (1) AMENDMENT.—Chapter 29 of title 35,
                                  2               United States Code, is amended by adding at the
                                  3               end the following new section:
                                  4 ‘‘§ 299A. Discovery in patent infringement action
                                  5               ‘‘(a) DISCOVERY                   IN     PATENT INFRINGEMENT AC-
                                  6        TION.—Except              as provided in subsection (b), in a civil ac-
                                  7 tion arising under any Act of Congress relating to patents,
                                  8 if the court determines that a ruling relating to the con-
                                  9 struction of terms used in a patent claim asserted in the
                                10 complaint is required, discovery shall be limited, until such
                                11 ruling is issued, to information necessary for the court to
                                12 determine the meaning of the terms used in the patent
                                13 claim, including any interpretation of those terms used to
                                14 support the claim of infringement.
                                15                ‘‘(b) DISCRETION                        TO    EXPAND SCOPE                  OF     DIS-
                                16         COVERY.—

                                17                         ‘‘(1) TIMELY               RESOLUTION OF ACTIONS.—If,

                                18                under any provision of Federal law (including the
                                19                amendments made by the Drug Price Competition
                                20                and Patent Term Restoration Act of 1984 (Public
                                21                Law 98–417)), resolution within a specified period
                                22                of time of a civil action arising under any Act of
                                23                Congress relating to patents will necessarily affect
                                24                the rights of a party with respect to the patent, the
                                25                court may permit discovery, in addition to the dis-


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                                                                                          11
                                  1               covery authorized under subsection (a), before the
                                  2               ruling described in subsection (a) is issued as nec-
                                  3               essary to ensure timely resolution of the action.
                                  4                        ‘‘(2) RESOLUTION                     OF MOTIONS.—When                     nec-
                                  5               essary to resolve a motion properly raised by a party
                                  6               before a ruling relating to the construction of terms
                                  7               described in subsection (a), the court may allow lim-
                                  8               ited discovery in addition to the discovery authorized
                                  9               under subsection (a) as necessary to resolve the mo-
                                10                tion.’’.
                                11                         (2) CONFORMING                      AMENDMENT.—The                  table of
                                12                sections for chapter 29 of title 35, United States
                                13                Code, is amended by adding at the end the following
                                14                new item:
                                               ‘‘299A. Discovery in patent infringement action’’.

                                15                (e) EFFECTIVE DATE.—Except as otherwise provided
                                16 in this section, the amendments made by this section shall
                                17 take effect on the date of the enactment of this Act and
                                18 shall apply to any action for which a complaint is filed
                                19 on or after that date.
                                20         SEC. 4. TRANSPARENCY OF PATENT OWNERSHIP.

                                21                (a) AMENDMENTS.—Section 290 of title 35, United
                                22 States Code, is amended—
                                23                         (1) in the heading, by striking ‘‘suits’’ and in-
                                24                serting ‘‘suits; disclosure of interests’’;


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                                                                                          12
                                  1                        (2) by striking ‘‘The clerks’’ and inserting ‘‘(a)
                                  2               Notice of patent suits.—The clerks’’; and
                                  3                        (3) by adding at the end the following new sub-
                                  4               sections:
                                  5               ‘‘(b) INITIAL DISCLOSURE.—
                                  6                        ‘‘(1) IN      GENERAL.—Except                     as provided in para-
                                  7               graph (2), upon the filing of an initial complaint for
                                  8               patent infringement, the plaintiff shall disclose to
                                  9               the Patent and Trademark Office, the court, and
                                10                each adverse party the identity of each of the fol-
                                11                lowing:
                                12                                 ‘‘(A) The assignee of the patent or patents
                                13                         at issue.
                                14                                 ‘‘(B) Any entity with a right to sublicense
                                15                         or enforce the patent or patents at issue.
                                16                                 ‘‘(C) Any entity, other than the plaintiff,
                                17                         that the plaintiff knows to have a financial in-
                                18                         terest in the patent or patents at issue or the
                                19                         plaintiff.
                                20                                 ‘‘(D) The ultimate parent entity of any as-
                                21                         signee identified under subparagraph (A) and
                                22                         any entity identified under subparagraphs (B)
                                23                         and (C).
                                24                         ‘‘(2) EXEMPTION.—The requirements of para-
                                25                graph (1) shall not apply with respect to a civil ac-


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                                                                                          13
                                  1               tion filed under subsection (a) that includes a cause
                                  2               of action described under section 271(e)(2).
                                  3               ‘‘(c) DISCLOSURE COMPLIANCE.—
                                  4                        ‘‘(1) PUBLICLY                 TRADED.—For              purposes of sub-
                                  5               section (b)(1)(C), if the financial interest is held by
                                  6               a corporation traded on a public stock exchange, an
                                  7               identification of the name of the corporation and the
                                  8               public exchange listing shall satisfy the disclosure re-
                                  9               quirement.
                                10                         ‘‘(2) NOT           PUBLICLY TRADED.—For                       purposes of
                                11                subsection (b)(1)(C), if the financial interest is not
                                12                held by a publicly traded corporation, the disclosure
                                13                shall satisfy the disclosure requirement if the infor-
                                14                mation identifies—
                                15                                 ‘‘(A) in the case of a partnership, the
                                16                         name of the partnership and the name and cor-
                                17                         respondence address of each partner or other
                                18                         entity that holds more than a 5-percent share
                                19                         of that partnership;
                                20                                 ‘‘(B) in the case of a corporation, the
                                21                         name of the corporation, the location of incor-
                                22                         poration, the address of the principal place of
                                23                         business, and the name of each officer of the
                                24                         corporation; and




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                                                                                          14
                                  1                                ‘‘(C) for each individual, the name and
                                  2                        correspondence address of that individual.
                                  3               ‘‘(d) ONGOING DUTY                       OF    DISCLOSURE            TO THE       PAT-
                                  4        ENT AND        TRADEMARK OFFICE.—
                                  5                        ‘‘(1) IN      GENERAL.—A                   plaintiff required to sub-
                                  6               mit information under subsection (b) or a subse-
                                  7               quent owner of the patent or patents at issue shall,
                                  8               not later than 90 days after any change in the as-
                                  9               signee of the patent or patents at issue or an entity
                                10                described under subparagraphs (B) and (D) of sub-
                                11                section (b)(1), submit to the Patent and Trademark
                                12                Office the updated identification of such assignee or
                                13                entity.
                                14                         ‘‘(2) FAILURE              TO COMPLY.—With                    respect to a
                                15                patent for which the requirement of paragraph (1)
                                16                has not been met—
                                17                                 ‘‘(A) the plaintiff or subsequent owner
                                18                         shall not be entitled to recover reasonable fees
                                19                         and other expenses under section 285 or in-
                                20                         creased damages under section 284 with respect
                                21                         to infringing activities taking place during any
                                22                         period of noncompliance with paragraph (1),
                                23                         unless the denial of such damages or fees would
                                24                         be manifestly unjust; and




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                                                                                          15
                                  1                                ‘‘(B) the court shall award to a prevailing
                                  2                        party accused of infringement reasonable fees
                                  3                        and other expenses incurred to discover the up-
                                  4                        dated assignee or entity described under para-
                                  5                        graph (1), unless such sanctions would be un-
                                  6                        just.
                                  7               ‘‘(e) DEFINITIONS.—In this section:
                                  8                        ‘‘(1) FINANCIAL                 INTEREST.—The                 term ‘finan-
                                  9               cial interest’—
                                10                                 ‘‘(A) means—
                                11                                         ‘‘(i) with regard to a patent or pat-
                                12                                 ents, the right of a person to receive pro-
                                13                                 ceeds related to the assertion of the patent
                                14                                 or patents, including a fixed or variable
                                15                                 portion of such proceeds; and
                                16                                         ‘‘(ii) with regard to the plaintiff, di-
                                17                                 rect or indirect ownership or control by a
                                18                                 person of more than 5% of such plaintiff;
                                19                                 and
                                20                                 ‘‘(B) does not mean—
                                21                                         ‘‘(i) ownership of shares or other in-
                                22                                 terests in a mutual or common investment
                                23                                 fund, unless the owner of such interest
                                24                                 participates in the management of such
                                25                                 fund; or


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                                                                                          16
                                  1                                        ‘‘(ii) the proprietary interest of a pol-
                                  2                                icyholder in a mutual insurance company,
                                  3                                of a depositor in a mutual savings associa-
                                  4                                tion, or a similar proprietary interest, un-
                                  5                                less the outcome of the proceeding could
                                  6                                substantially affect the value of such inter-
                                  7                                est.
                                  8                        ‘‘(2)       PROCEEDING.—The                         term       ‘proceeding’
                                  9               means all stages of a civil action, including pretrial
                                10                and trial proceedings and appellate review.
                                11                         ‘‘(3) ULTIMATE                 PARENT ENTITY.—

                                12                                 ‘‘(A) IN        GENERAL.—Except                    as provided in
                                13                         subparagraph (B), the term ‘ultimate parent
                                14                         entity’ has the meaning given such term in sec-
                                15                         tion 801.1(a)(3) of title 16, Code of Federal
                                16                         Regulations, or any successor regulation.
                                17                                 ‘‘(B) MODIFICATION                     OF DEFINITION.—The

                                18                         Director may modify the definition of ‘ultimate
                                19                         parent entity’ by regulation.’’.
                                20                (b) TECHNICAL                  AND       CONFORMING AMENDMENT.—
                                21 The item relating to section 290 in the table of sections
                                22 for chapter 29 of title 35, United States Code, is amended
                                23 to read as follows:
                                               ‘‘290. Notice of patent suits; disclosure of interests’’.

                                24                (c) REGULATIONS.—The Director may promulgate
                                25 such regulations as are necessary to establish a registra-
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                                                                                          17
                                  1 tion fee in an amount sufficient to recover the estimated
                                  2 costs of administering subsections (b) through (e) of sec-
                                  3 tion 290 of title 35, United States Code, as added by sub-
                                  4 section (a), to facilitate the collection and maintenance of
                                  5 the information required by such subsections, and to en-
                                  6 sure the timely disclosure of such information to the pub-
                                  7 lic.
                                  8               (d) EFFECTIVE DATE.—The amendments made by
                                  9 this section shall take effect upon the expiration of the
                                10 6-month period beginning on the date of the enactment
                                11 of this Act and shall apply to any action for which a com-
                                12 plaint is filed on or after such effective date.
                                13         SEC. 5. CUSTOMER-SUIT EXCEPTION.

                                14                (a) AMENDMENT.—Section 296 of title 35, United
                                15 States Code, is amended to read as follows:
                                16 ‘‘§ 296. Stay of action against customer
                                17                ‘‘(a) STAY         OF    ACTION AGAINST CUSTOMER.—Except
                                18 as provided in subsection (d), in any civil action arising
                                19 under any Act of Congress relating to patents, the court
                                20 shall grant a motion to stay at least the portion of the
                                21 action against a covered customer related to infringement
                                22 of a patent involving a covered product or process if the
                                23 following requirements are met:
                                24                         ‘‘(1) The covered manufacturer and the covered
                                25                customer consent in writing to the stay.


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                                                                                          18
                                  1                        ‘‘(2) The covered manufacturer is a party to
                                  2               the action or to a separate action involving the same
                                  3               patent or patents related to the same covered prod-
                                  4               uct or process.
                                  5                        ‘‘(3) The covered customer agrees to be bound
                                  6               by any judgment entered against the covered manu-
                                  7               facturer to the same extent that the covered manu-
                                  8               facturer may be bound with respect to issues that
                                  9               the covered manufacturer and the covered customer
                                10                have in common.
                                11                         ‘‘(4) The motion is filed after the first pleading
                                12                in the action and not later than 120 days after serv-
                                13                ice of the first pleading in the action that specifically
                                14                identifies—
                                15                                 ‘‘(A) the covered product or process as a
                                16                         basis for the alleged infringement of the patent
                                17                         by the covered customer; and
                                18                                 ‘‘(B) how the covered product or process is
                                19                         alleged to infringe the patent.
                                20                ‘‘(b) APPLICABILITY                     OF   STAY.—A stay issued pursu-
                                21 ant to subsection (a) shall apply only to the patents, prod-
                                22 ucts, systems, or components accused of infringement in
                                23 the action.
                                24                ‘‘(c) LIFT OF STAY.—




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                                                                                          19
                                  1                        ‘‘(1) IN      GENERAL.—A                   stay entered pursuant to
                                  2               this section may be lifted upon grant of a motion
                                  3               based on a showing that—
                                  4                                ‘‘(A) the action involving the covered man-
                                  5                        ufacturer will not resolve a major issue in suit
                                  6                        against the covered customer; or
                                  7                                ‘‘(B) the stay unreasonably prejudices and
                                  8                        would be manifestly unjust to the party seeking
                                  9                        to lift the stay.
                                10                         ‘‘(2) SEPARATE                   MANUFACTURER ACTION IN-

                                11                VOLVED.—In               the case of a stay entered based on the
                                12                participation of the covered manufacturer in a sepa-
                                13                rate action involving the same patent or patents re-
                                14                lated to the same covered product or process, a mo-
                                15                tion under this subsection may only be made if the
                                16                court in such separate action determines the show-
                                17                ing required under paragraph (1) has been met.
                                18                ‘‘(d) EXEMPTION.—This section shall not apply to an
                                19 action that includes a cause of action described under sec-
                                20 tion 271(e).
                                21                ‘‘(e) RULE          OF       CONSTRUCTION.—Nothing in this sec-
                                22 tion shall be construed to limit the ability of a court to
                                23 grant any stay, or expand any stay granted pursuant to
                                24 this section, if otherwise permitted by law.
                                25                ‘‘(f) DEFINITIONS.—In this section:


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                                                                                          20
                                  1                        ‘‘(1) COVERED                  CUSTOMER.—The                term ‘covered
                                  2               customer’ means a party accused of infringing a pat-
                                  3               ent or patents in dispute based on a covered product
                                  4               or process.
                                  5                        ‘‘(2) COVERED                    MANUFACTURER.—The                       term
                                  6               ‘covered manufacturer’ means a person that manu-
                                  7               factures or supplies, or causes the manufacture or
                                  8               supply of, a covered product or process or a relevant
                                  9               part of such product or process.
                                10                         ‘‘(3) COVERED                   PRODUCT OR PROCESS.—The

                                11                term ‘covered product or process’ means a product,
                                12                process, system, service, component, material, or ap-
                                13                paratus, or relevant part thereof, that—
                                14                                 ‘‘(A) is alleged to infringe the patent or
                                15                         patents in dispute; or
                                16                                 ‘‘(B) implements a process alleged to in-
                                17                         fringe the patent or patents in dispute.’’.
                                18                (b) CONFORMING AMENDMENT.—The table of sec-
                                19 tions for chapter 29 of title 35, United States Code, is
                                20 amended by striking the item relating to section 296 and
                                21 inserting the following:
                                               ‘‘296. Stay of action against customer.’’.

                                22                (c) EFFECTIVE DATE.—The amendments made by
                                23 this section shall take effect on the date of the enactment
                                24 of this Act and shall apply to any action for which a com-
                                25 plaint is filed on or after that date.
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                                                                                          21
                                  1        SEC. 6. PROCEDURES AND PRACTICES TO IMPLEMENT AND

                                  2                                RECOMMENDATIONS TO THE JUDICIAL CON-

                                  3                                FERENCE.

                                  4               (a) JUDICIAL CONFERENCE RULES                                        AND      PROCE-
                                  5        DURES ON         DISCOVERY BURDENS AND COSTS.—
                                  6                        (1) RULES              AND PROCEDURES.—The                           Judicial
                                  7               Conference of the United States, using existing re-
                                  8               sources, shall develop rules and procedures to imple-
                                  9               ment the requirements described in paragraph (2) to
                                10                address the asymmetries in discovery burdens and
                                11                costs in any civil action arising under any Act of
                                12                Congress relating to patents. Such rules and proce-
                                13                dures shall include how and when payment for docu-
                                14                ment discovery in addition to the discovery of core
                                15                documentary evidence is to occur, and what informa-
                                16                tion must be presented to demonstrate financial ca-
                                17                pacity before permitting document discovery in addi-
                                18                tion to the discovery of core documentary evidence.
                                19                         (2) RULES             AND PROCEDURES TO BE CONSID-

                                20                ERED.—The               rules and procedures required under
                                21                paragraph (1) shall include each of the following re-
                                22                quirements:
                                23                                  (A) DISCOVERY                     OF CORE DOCUMENTARY

                                24                         EVIDENCE.—Each                      party to the action is enti-
                                25                         tled to receive core documentary evidence and
                                26                         shall be responsible for the costs of producing
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                                                                                          22
                                  1                        core documentary evidence within the posses-
                                  2                        sion or control of each such party. Each party
                                  3                        to the action may seek nondocumentary dis-
                                  4                        covery as otherwise provided in the Federal
                                  5                        Rules of Civil Procedure.
                                  6                                (B) ELECTRONIC                     COMMUNICATION.—If                the
                                  7                        parties determine that the discovery of elec-
                                  8                        tronic communication is necessary, such dis-
                                  9                        covery shall occur after the parties have ex-
                                10                         changed initial disclosures and core documen-
                                11                         tary evidence and shall be in accordance with
                                12                         the following:
                                13                                         (i) Any request for the production of
                                14                                 electronic communication shall be specific
                                15                                 and may not be a general request for the
                                16                                 production of information relating to a
                                17                                 product or business.
                                18                                         (ii) Each request shall identify the
                                19                                 custodian of the information requested, the
                                20                                 search terms, and a time frame. The par-
                                21                                 ties shall cooperate to identify the proper
                                22                                 custodians, the proper search terms, and
                                23                                 the proper time frame.
                                24                                         (iii) A party may not submit produc-
                                25                                 tion requests to more than 5 custodians,


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                                                                                          23
                                  1                                unless the parties jointly agree to modify
                                  2                                the number of production requests without
                                  3                                leave of the court.
                                  4                                        (iv) The court may consider contested
                                  5                                requests for up to 5 additional custodians
                                  6                                per producing party, upon a showing of a
                                  7                                distinct need based on the size, complexity,
                                  8                                and issues of the case.
                                  9                                        (v) If a party requests the discovery
                                10                                 of electronic communication for additional
                                11                                 custodians beyond the limits agreed to by
                                12                                 the parties or granted by the court, the re-
                                13                                 questing party shall bear all reasonable
                                14                                 costs caused by such additional discovery.
                                15                                 (C) ADDITIONAL                     DOCUMENT DISCOVERY.—

                                16                                         (i) IN         GENERAL.—Each                 party to the
                                17                                 action may seek any additional document
                                18                                 discovery otherwise permitted under the
                                19                                 Federal Rules of Civil Procedure, if such
                                20                                 party bears the reasonable costs, including
                                21                                 reasonable attorney’s fees, of the additional
                                22                                 document discovery.
                                23                                         (ii) REQUIREMENTS                     FOR ADDITIONAL

                                24                                 DOCUMENT DISCOVERY.—Unless                                 the par-
                                25                                 ties mutually agree otherwise, no party


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                                                                                          24
                                  1                                may be permitted additional document dis-
                                  2                                covery unless such a party posts a bond, or
                                  3                                provides other security, in an amount suffi-
                                  4                                cient to cover the expected costs of such
                                  5                                additional document discovery, or makes a
                                  6                                showing to the court that such party has
                                  7                                the financial capacity to pay the costs of
                                  8                                such additional document discovery.
                                  9                                        (iii) LIMITS               ON ADDITIONAL DOCU-

                                10                                 MENT DISCOVERY.—A                         court, upon motion,
                                11                                 may determine that a request for addi-
                                12                                 tional document discovery is excessive, ir-
                                13                                 relevant, or otherwise abusive and may set
                                14                                 limits on such additional document dis-
                                15                                 covery.
                                16                                         (iv) GOOD              CAUSE MODIFICATION.—A

                                17                                 court, upon motion and for good cause
                                18                                 shown, may modify the requirements of
                                19                                 subparagraphs (A) and (B) and any defini-
                                20                                 tion under paragraph (3). Not later than
                                21                                 30 days after the pretrial conference under
                                22                                 Rule 16 of the Federal Rules of Civil Pro-
                                23                                 cedure, the parties shall jointly submit any
                                24                                 proposed modifications of the requirements
                                25                                 of subparagraphs (A) and (B) and any def-


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                                                                                          25
                                  1                                inition under paragraph (3), unless the
                                  2                                parties do not agree, in which case each
                                  3                                party shall submit any proposed modifica-
                                  4                                tion of such party and a summary of the
                                  5                                disagreement over the modification.
                                  6                                        (v) COMPUTER                  CODE.—A          court, upon
                                  7                                motion and for good cause shown, may de-
                                  8                                termine that computer code should be in-
                                  9                                cluded in the discovery of core documen-
                                10                                 tary evidence. The discovery of computer
                                11                                 code shall occur after the parties have ex-
                                12                                 changed initial disclosures and other core
                                13                                 documentary evidence.
                                14                                 (D) DISCOVERY                      SEQUENCE AND SCOPE.—

                                15                         The parties shall discuss and address in the
                                16                         written report filed pursuant to Rule 26(f) of
                                17                         the Federal Rules of Civil Procedure the views
                                18                         and proposals of each party on the following:
                                19                                         (i) When the discovery of core docu-
                                20                                 mentary evidence should be completed.
                                21                                         (ii) Whether additional document dis-
                                22                                 covery will be sought under subparagraph
                                23                                 (C).
                                24                                         (iii) Any issues about infringement,
                                25                                 invalidity, or damages that, if resolved be-


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                                                                                          26
                                  1                                fore the additional discovery described in
                                  2                                subparagraph (C) commences, might sim-
                                  3                                plify or streamline the case, including the
                                  4                                identification of any terms or phrases re-
                                  5                                lating to any patent claim at issue to be
                                  6                                construed by the court and whether the
                                  7                                early construction of any of those terms or
                                  8                                phrases would be helpful.
                                  9                        (3) DEFINITIONS.—In this subsection:
                                10                                 (A) CORE               DOCUMENTARY EVIDENCE.—In

                                11                         this subsection, the term ‘‘core documentary
                                12                         evidence’’—
                                13                                         (i) includes—
                                14                                                   (I) documents relating to the
                                15                                         conception of, reduction to practice of,
                                16                                         and application for, the patent or pat-
                                17                                         ents at issue;
                                18                                                   (II) documents sufficient to show
                                19                                         the technical operation of the product
                                20                                         or process identified in the complaint
                                21                                         as infringing the patent or patents at
                                22                                         issue;
                                23                                                   (III) documents relating to po-
                                24                                         tentially invalidating prior art;




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                                                                                          27
                                  1                                                  (IV) documents relating to any
                                  2                                        licensing of, or other transfer of rights
                                  3                                        to, the patent or patents at issue be-
                                  4                                        fore the date on which the complaint
                                  5                                        is filed;
                                  6                                                  (V) documents sufficient to show
                                  7                                        profit attributable to the claimed in-
                                  8                                        vention of the patent or patents at
                                  9                                        issue;
                                10                                                   (VI) documents relating to any
                                11                                         knowledge by the accused infringer of
                                12                                         the patent or patents at issue before
                                13                                         the date on which the complaint is
                                14                                         filed;
                                15                                                   (VII) documents relating to any
                                16                                         knowledge by the patentee of infringe-
                                17                                         ment of the patent or patents at issue
                                18                                         before the date on which the com-
                                19                                         plaint is filed;
                                20                                                   (VIII) documents relating to any
                                21                                         licensing term or pricing commitment
                                22                                         to which the patent or patents may be
                                23                                         subject through any agency or stand-
                                24                                         ard-setting body; and




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                                                                                          28
                                  1                                                  (IX)         documents            sufficient        to
                                  2                                        show any marking or other notice pro-
                                  3                                        vided of the patent or patents at
                                  4                                        issue; and
                                  5                                        (ii) does not include computer code,
                                  6                                except as specified in paragraph (2)(C)(v).
                                  7                                (B) ELECTRONIC                       COMMUNICATION.—The

                                  8                        term ‘‘electronic communication’’ means any
                                  9                        form of electronic communication, including
                                10                         email, text message, or instant message.
                                11                         (4)       IMPLEMENTATION                        BY      THE        DISTRICT

                                12                COURTS.—Not                  later than 6 months after the date on
                                13                which the Judicial Conference has developed the
                                14                rules and procedures required by this subsection,
                                15                each United States district court and the United
                                16                States Court of Federal Claims shall revise the ap-
                                17                plicable local rules for such court to implement such
                                18                rules and procedures.
                                19                         (5) AUTHORITY                  FOR JUDICIAL CONFERENCE TO

                                20                REVIEW           AND         MODIFY.—The                  Judicial Conference
                                21                shall study the efficacy of the rules and procedures
                                22                required by this subsection during the first 4 years
                                23                following the implementation of such rules and pro-
                                24                cedures by the district courts and the United States
                                25                Court of Federal Claims. The Judicial Conference


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                                                                                          29
                                  1               may modify such rules and procedures following
                                  2               such 4-year period.
                                  3               (b) JUDICIAL CONFERENCE PATENT CASE MANAGE-
                                  4        MENT.—The               Judicial Conference of the United States,
                                  5 using existing resources, shall develop case management
                                  6 procedures to be implemented by the United States dis-
                                  7 trict courts and the United States Court of Federal Claims
                                  8 for any civil action arising under any Act of Congress re-
                                  9 lating to patents, including initial disclosure and early case
                                10 management conference practices that—
                                11                         (1) will identify any potential dispositive issues
                                12                of the case; and
                                13                         (2) focus on early summary judgment motions
                                14                when resolution of issues may lead to expedited dis-
                                15                position of the case.
                                16                (c) REVISION                 OF    FORM             FOR    PATENT INFRINGE-
                                17         MENT.—

                                18                         (1) ELIMINATION                      OF      FORM.—The             Supreme
                                19                Court, using existing resources, shall eliminate Form
                                20                18 in the Appendix to the Federal Rules of Civil
                                21                Procedure (relating to Complaint for Patent In-
                                22                fringement), effective on the date of the enactment
                                23                of this Act.
                                24                         (2) REVISED              FORM.—The               Supreme Court may
                                25                prescribe a new form or forms setting out model al-


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                                                                                          30
                                  1               legations of patent infringement that, at a minimum,
                                  2               notify accused infringers of the asserted claim or
                                  3               claims, the products or services accused of infringe-
                                  4               ment, and the plaintiff’s theory for how each ac-
                                  5               cused product or service meets each limitation of
                                  6               each asserted claim. The Judicial Conference should
                                  7               exercise the authority under section 2073 of title 28,
                                  8               United States Code, to make recommendations with
                                  9               respect to such new form or forms.
                                10                (d) PROTECTION                   OF      INTELLECTUAL-PROPERTY LI-
                                11         CENSES IN         BANKRUPTCY.—
                                12                         (1) IN       GENERAL.—Section                     1520(a) of title 11,
                                13                United States Code, is amended—
                                14                                 (A) in paragraph (3), by striking ‘‘; and’’
                                15                         and inserting a semicolon;
                                16                                 (B) in paragraph (4), by striking the pe-
                                17                         riod at the end and inserting ‘‘; and’’; and
                                18                                 (C) by inserting at the end the following
                                19                         new paragraph:
                                20                         ‘‘(5) section 365(n) applies to intellectual prop-
                                21                erty of which the debtor is a licensor or which the
                                22                debtor has transferred.’’.
                                23                         (2) EFFECTIVE                  DATE.—The            amendments made
                                24                by this subsection shall take effect on the date of the
                                25                enactment of this Act and shall apply to any action


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                                                                                          31
                                  1               for which a complaint is pending on, or filed on or
                                  2               after, such date of enactment.
                                  3        SEC. 7. SMALL BUSINESS EDUCATION, OUTREACH, AND IN-

                                  4                                FORMATION ACCESS.

                                  5               (a)      SMALL               BUSINESS               EDUCATION           AND       OUT-
                                  6        REACH.—

                                  7                        (1) RESOURCES                  FOR SMALL BUSINESS.—Using

                                  8               existing resources, the Director shall develop edu-
                                  9               cational resources for small businesses to address
                                10                concerns arising from patent infringement.
                                11                         (2) SMALL             BUSINESS PATENT OMBUDSMAN.—

                                12                The Patent Ombudsman Program established under
                                13                section 28 of the Leahy-Smith America Invents Act
                                14                (Public Law 112–29; 125 Stat. 339; 35 U.S.C. 2
                                15                note) shall coordinate with the existing small busi-
                                16                ness outreach programs of the Office to provide edu-
                                17                cation and awareness on abusive patent litigation
                                18                practices.
                                19                (b) IMPROVING INFORMATION TRANSPARENCY                                              FOR

                                20 SMALL BUSINESS AND THE UNITED STATES PATENT AND
                                21 TRADEMARK OFFICE USERS.—
                                22                         (1) WEBSITE.—Using existing resources, the
                                23                Director shall create a user-friendly section on the
                                24                official website of the Office to notify the public
                                25                when a patent case is brought in Federal court and


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                                                                                          32
                                  1               with respect to each patent at issue in such case, the
                                  2               Director shall include—
                                  3                                 (A) information disclosed pursuant to sub-
                                  4                        sections (b) and (d) of section 290 of title 35,
                                  5                        United States Code, as added by section 4(a) of
                                  6                        this Act; and
                                  7                                 (B) any other information the Director de-
                                  8                        termines to be relevant.
                                  9                        (2) FORMAT.—In order to promote accessibility
                                10                for the public, the information described in para-
                                11                graph (1) shall be searchable by patent number, pat-
                                12                ent art area, and entity.
                                13         SEC. 8. STUDIES ON PATENT TRANSACTIONS, QUALITY,

                                14                                 AND EXAMINATION.

                                15                (a) STUDY ON SECONDARY MARKET OVERSIGHT FOR
                                16 PATENT TRANSACTIONS                                    TO     PROMOTE TRANSPARENCY
                                17         AND   ETHICAL BUSINESS PRACTICES.—
                                18                         (1) STUDY             REQUIRED.—The                   Director, in con-
                                19                sultation with the Secretary of Commerce, the Sec-
                                20                retary of the Treasury, the Chairman of the Securi-
                                21                ties and Exchange Commission, the heads of other
                                22                relevant agencies, and interested parties, shall, using
                                23                existing resources of the Office, conduct a study—
                                24                                  (A) to develop legislative recommendations
                                25                         to ensure greater transparency and account-


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                                                                                          33
                                  1                        ability in patent transactions occurring on the
                                  2                        secondary market;
                                  3                                (B) to examine the economic impact that
                                  4                        the patent secondary market has on the United
                                  5                        States;
                                  6                                (C) to examine licensing and other over-
                                  7                        sight requirements that may be placed on the
                                  8                        patent secondary market, including on the par-
                                  9                        ticipants in such markets, to ensure that the
                                10                         market is a level playing field and that brokers
                                11                         in the market have the requisite expertise and
                                12                         adhere to ethical business practices; and
                                13                                 (D) to examine the requirements placed on
                                14                         other markets.
                                15                         (2) SUBMISSION                  OF STUDY.—Not                 later than 1
                                16                year after the date of the enactment of this Act, the
                                17                Director shall submit a report to the Committee on
                                18                the Judiciary of the House of Representatives and
                                19                the Committee on the Judiciary of the Senate on the
                                20                findings and recommendations of the Director from
                                21                the study required under paragraph (1).
                                22                (b) STUDY             ON     PATENTS OWNED                     BY THE        UNITED
                                23 STATES GOVERNMENT.—
                                24                         (1) STUDY             REQUIRED.—The                   Director, in con-
                                25                sultation with the heads of relevant agencies and in-


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                                                                                          34
                                  1               terested parties, shall, using existing resources of the
                                  2               Office, conduct a study on patents owned by the
                                  3               United States Government that—
                                  4                                (A) examines how such patents are li-
                                  5                        censed and sold, and any litigation relating to
                                  6                        the licensing or sale of such patents;
                                  7                                (B) provides legislative and administrative
                                  8                        recommendations on whether there should be
                                  9                        restrictions placed on patents acquired from the
                                10                         United States Government;
                                11                                 (C) examines whether or not each relevant
                                12                         agency maintains adequate records on the pat-
                                13                         ents owned by such agency, specifically whether
                                14                         such agency addresses licensing, assignment,
                                15                         and Government grants for technology related
                                16                         to such patents; and
                                17                                 (D) provides recommendations to ensure
                                18                         that each relevant agency has an adequate
                                19                         point of contact that is responsible for man-
                                20                         aging the patent portfolio of the agency.
                                21                         (2) REPORT                ON STUDY.—Not                     later than 6
                                22                months after the date of the enactment of this Act,
                                23                the Director shall submit to the Committee on the
                                24                Judiciary of the House of Representatives and the
                                25                Committee on the Judiciary of the Senate a report


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                                                                                          35
                                  1               on the findings and recommendations of the Director
                                  2               from the study required under paragraph (1).
                                  3               (c) STUDY             ON     PATENT QUALITY                     AND     ACCESS        TO

                                  4        THE    BEST INFORMATION DURING EXAMINATION.—
                                  5                        (1) GAO             STUDY.—The               Comptroller General of
                                  6               the United States shall conduct a study on patent
                                  7               examination at the Office and the technologies avail-
                                  8               able to improve examination and improve patent
                                  9               quality.
                                10                         (2) CONTENTS                   OF THE STUDY.—The                   study re-
                                11                quired under paragraph (1) shall include the fol-
                                12                lowing:
                                13                                 (A) An examination of patent quality at
                                14                         the Office.
                                15                                 (B) An examination of ways to improve
                                16                         quality, specifically through technology, that
                                17                         shall include examining best practices at foreign
                                18                         patent offices and the use of existing off-the-
                                19                         shelf technologies to improve patent examina-
                                20                         tion.
                                21                                 (C) A description of how patents are clas-
                                22                         sified.
                                23                                 (D) An examination of procedures in place
                                24                         to prevent double patenting through filing by
                                25                         applicants in multiple art areas.


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                                                                                          36
                                  1                                 (E) An examination of the types of off-the-
                                  2                        shelf prior art databases and search software
                                  3                        used by foreign patent offices and governments,
                                  4                        particularly in Europe and Asia, and whether
                                  5                        those databases and search tools could be used
                                  6                        by the Office to improve patent examination.
                                  7                                 (F) An examination of any other areas the
                                  8                        Comptroller General determines to be relevant.
                                  9                        (3) REPORT              TO CONGRESS.—Not                     later than 6
                                10                months after the date of the enactment of this Act,
                                11                the Comptroller General shall submit to the Com-
                                12                mittee on the Judiciary of the House of Representa-
                                13                tives and the Committee on the Judiciary of the
                                14                Senate a report on the findings and recommenda-
                                15                tions from the study required by this subsection, in-
                                16                cluding recommendations for any changes to laws
                                17                and regulations that will improve the examination of
                                18                patent applications and patent quality.
                                19         SEC. 9. IMPROVEMENTS AND TECHNICAL CORRECTIONS TO

                                20                                 THE LEAHY-SMITH AMERICA INVENTS ACT.

                                21                (a) REPEAL              OF     CIVIL ACTION                TO    OBTAIN       A   PAT-
                                22         ENT.—

                                23                         (1) REPEAL.—Section 145 of title 35, United
                                24                States Code, is repealed.
                                25                         (2) CONFORMING                   AMENDMENTS.—



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                                                                                          37
                                  1                                (A) FEDERAL                    CIRCUIT         JURISDICTION.—

                                  2                        Section 1295(a)(4) of title 28, United States
                                  3                        Code, is amended—
                                  4                                        (i) in subparagraph (A), by striking
                                  5                                ‘‘except that an applicant or a party’’ and
                                  6                                all that follows through the end of the sub-
                                  7                                paragraph and inserting the following: ‘‘ex-
                                  8                                cept that a party to a derivation pro-
                                  9                                ceeding may also have remedy by civil ac-
                                10                                 tion pursuant to section 146 of title 35; an
                                11                                 appeal under this subparagraph of a deci-
                                12                                 sion of the Board with respect to a deriva-
                                13                                 tion proceeding shall waive the right of
                                14                                 such party to proceed under section 146 of
                                15                                 title 35;’’; and
                                16                                         (ii) in subparagraph (C), by striking
                                17                                 ‘‘section 145, 146, or’’ and inserting ‘‘sec-
                                18                                 tion 146 or’’.
                                19                                 (B) FEDERAL                   CIRCUIT APPEAL.—Section

                                20                         141(a) of title 35, United States Code, is
                                21                         amended—
                                22                                         (i) by striking ‘‘may appeal the
                                23                                 Board’s decision to’’ and inserting ‘‘may
                                24                                 appeal the Board’s decision only to’’; and
                                25                                         (ii) by striking the second sentence.


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                                                                                          38
                                  1                                (C) ADJUSTMENT                     OF PATENT TERM.—Sec-

                                  2                        tion 154(b)(1)(A)(iii) of title 35, United States
                                  3                        Code, is amended by striking ‘‘section 141, 145,
                                  4                        or 146’’ and inserting ‘‘section 141 or 146’’.
                                  5                                (D) CLERICAL                AMENDMENT.—The                   table of
                                  6                        sections for chapter 13 of title 35, United
                                  7                        States Code, is amended by repealing the item
                                  8                        relating to section 145.
                                  9                        (3) EFFECTIVE                  DATE.—The            amendments made
                                10                by this subsection shall apply to any proceeding in
                                11                which a decision is made by the Patent Trial and
                                12                Appeal Board on or after the date of the enactment
                                13                of this Act.
                                14                (b) POST-GRANT REVIEW AMENDMENT.—Section
                                15 325(e)(2) of title 35, United States Code is amended by
                                16 striking ‘‘or reasonably could have raised’’.
                                17                (c) USE          OF   DISTRICT-COURT CLAIM CONSTRUCTION
                                18         IN   POST-GRANT AND INTER PARTES REVIEWS.—
                                19                         (1) INTER           PARTES REVIEW.—Section                        316(a) of
                                20                title 35, United States Code, is amended—
                                21                                 (A) in paragraph (12), by striking ‘‘; and’’
                                22                         and inserting a semicolon;
                                23                                 (B) in paragraph (13), by striking the pe-
                                24                         riod at the end and inserting ‘‘; and’’; and




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                                                                                          39
                                  1                                (C) by adding at the end the following new
                                  2                        paragraph:
                                  3                        ‘‘(14) providing that for all purposes under this
                                  4               chapter—
                                  5                                ‘‘(A) each claim of a patent shall be con-
                                  6                        strued as such claim would be in a civil action
                                  7                        to invalidate a patent under section 282(b), in-
                                  8                        cluding construing each claim of the patent in
                                  9                        accordance with the ordinary and customary
                                10                         meaning of such claim as understood by one of
                                11                         ordinary skill in the art and the prosecution
                                12                         history pertaining to the patent; and
                                13                                 ‘‘(B) if a court has previously construed
                                14                         the claim or a claim term in a civil action in
                                15                         which the patent owner was a party, the Office
                                16                         shall consider such claim construction.’’.
                                17                         (2) POST-GRANT                      REVIEW.—Section              326(a) of
                                18                title 35, United States Code, is amended—
                                19                                 (A) in paragraph (11), by striking ‘‘; and’’
                                20                         and inserting a semicolon;
                                21                                 (B) in paragraph (12), by striking the pe-
                                22                         riod at the end and inserting ‘‘; and’’; and
                                23                                 (C) by adding at the end the following new
                                24                         paragraph:




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                                                                                          40
                                  1                        ‘‘(13) providing that for all purposes under this
                                  2               chapter—
                                  3                                ‘‘(A) each claim of a patent shall be con-
                                  4                        strued as such claim would be in a civil action
                                  5                        to invalidate a patent under section 282(b), in-
                                  6                        cluding construing each claim of the patent in
                                  7                        accordance with the ordinary and customary
                                  8                        meaning of such claim as understood by one of
                                  9                        ordinary skill in the art and the prosecution
                                10                         history pertaining to the patent; and
                                11                                 ‘‘(B) if a court has previously construed
                                12                         the claim or a claim term in a civil action in
                                13                         which the patent owner was a party, the Office
                                14                         shall consider such claim construction.’’.
                                15                         (3) TECHNICAL                       AND       CONFORMING             AMEND-

                                16                MENT.—Section                   18(a)(1)(A) of the Leahy-Smith
                                17                America Invents Act (Public Law 112–29; 126 Stat.
                                18                329) is amended by striking ‘‘Section 321(c)’’ and
                                19                inserting ‘‘Sections 321(c) and 326(a)(13)’’.
                                20                         (4) EFFECTIVE                  DATE.—The            amendments made
                                21                by this subsection shall take effect upon the expira-
                                22                tion of the 90-day period beginning on the date of
                                23                the enactment of this Act, and shall apply to any
                                24                proceeding under chapter 31 or 32 of title 35,




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                                                                                          41
                                  1               United States Code, for which the petition for review
                                  2               is filed on or after such effective date.
                                  3               (d) CODIFICATION                        OF     THE        DOUBLE-PATENTING
                                  4 DOCTRINE FOR FIRST-INVENTOR-TO-FILE PATENTS.—
                                  5                        (1) AMENDMENT.—Chapter 10 of title 35,
                                  6               United States Code, is amended by adding at the
                                  7               end the following new section:
                                  8 ‘‘§ 106. Prior art in cases of double patenting
                                  9               ‘‘A claimed invention of a patent issued under section
                                10 151 (referred to as the ‘first patent’) that is not prior art
                                11 to a claimed invention of another patent (referred to as
                                12 the ‘second patent’) shall be considered prior art to the
                                13 claimed invention of the second patent for the purpose of
                                14 determining the nonobviousness of the claimed invention
                                15 of the second patent under section 103 if—
                                16                         ‘‘(1) the claimed invention of the first patent
                                17                was effectively filed under section 102(d) on or be-
                                18                fore the effective filing date of the claimed invention
                                19                of the second patent;
                                20                         ‘‘(2) either—
                                21                                 ‘‘(A) the first patent and second patent
                                22                         name the same inventor; or
                                23                                 ‘‘(B) the claimed invention of the first pat-
                                24                         ent would constitute prior art to the claimed in-
                                25                         vention of the second patent under section


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                                                                                          42
                                  1                        102(a)(2)             if       an     exception           under       section
                                  2                        102(b)(2) were deemed to be inapplicable and
                                  3                        the claimed invention of the first patent was, or
                                  4                        were deemed to be, effectively filed under sec-
                                  5                        tion 102(d) before the effective filing date of
                                  6                        the claimed invention of the second patent; and
                                  7                        ‘‘(3) the patentee of the second patent has not
                                  8               disclaimed the rights to enforce the second patent
                                  9               independently from, and beyond the statutory term
                                10                of, the first patent.’’.
                                11                         (2) REGULATIONS.—The Director shall promul-
                                12                gate regulations setting forth the form and content
                                13                of any disclaimer required for a patent to be issued
                                14                in compliance with section 106 of title 35, United
                                15                States Code, as added by paragraph (1). Such regu-
                                16                lations shall apply to any disclaimer filed after a
                                17                patent has issued. A disclaimer, when filed, shall be
                                18                considered for the purpose of determining the valid-
                                19                ity of the patent under section 106 of title 35,
                                20                United States Code.
                                21                         (3) CONFORMING                      AMENDMENT.—The                  table of
                                22                sections for chapter 10 of title 35, United States
                                23                Code, is amended by adding at the end the following
                                24                new item:
                                               ‘‘106. Prior art in cases of double patenting.’’.




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                                                                                          43
                                  1                        (4) EXCLUSIVE                  RULE.—A          patent subject to sec-
                                  2               tion 106 of title 35, United States Code, as added
                                  3               by paragraph (1), shall not be held invalid on any
                                  4               nonstatutory, double-patenting ground.
                                  5                        (5) EFFECTIVE                  DATE.—The            amendments made
                                  6               by this subsection shall take effect on the date of the
                                  7               enactment of this Act and shall apply to a patent or
                                  8               patent application only if both the first and second
                                  9               patents described in section 106 of title 35, United
                                10                States Code, as added by paragraph (1), are patents
                                11                or patent applications that are described in section
                                12                3(n)(1) of the Leahy-Smith America Invents Act (35
                                13                U.S.C. 100 note).
                                14                (e) COVERED BUSINESS METHOD PATENT RE-
                                15         VIEWS.—

                                16                         (1) LIMITATION;                REPEAL.—

                                17                                 (A) LIMITATION                 TO FIRST-TO-INVENT PAT-

                                18                         ENTS.—Section                  18(a)(2) of the Leahy-Smith
                                19                         America Invents Act is amended by striking
                                20                         ‘‘shall not apply to a patent described in section
                                21                         6(f)(2)(A) of this Act during the period in
                                22                         which a petition for post-grant review of that
                                23                         patent would satisfy the requirements of section
                                24                         321(c) of title 35, United States Code’’ and in-
                                25                         serting ‘‘shall not apply to a patent that is de-


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                                                                                          44
                                  1                        scribed in section 3(n)(1) of this Act (but is not
                                  2                        described in section 3(n)(2) of this Act)’’.
                                  3                                (B) REPEAL                  OF SUNSET.—Section                  18(a)
                                  4                        of the Leahy-Smith America Invents Act (35
                                  5                        U.S.C. 321 note) is amended by striking para-
                                  6                        graph (3).
                                  7                                (C) EFFECTIVE                      DATE.—The          amendments
                                  8                        made by subparagraphs (A) and (B) shall take
                                  9                        effect on the date of the enactment of this Act.
                                10                         (2) DEFINITION;                 CLARIFICATION.—

                                11                                 (A) DEFINITION.—For purposes of section
                                12                         18(d) of the Leahy-Smith America Invents Act,
                                13                         the words ‘‘used in the practice, administration,
                                14                         or management of a financial product or serv-
                                15                         ice’’ shall be construed consistently with the in-
                                16                         stitution decision of the Patent Trial and Ap-
                                17                         peal Board of the United States Patent and
                                18                         Trademark Office in SAP America, Inc. v.
                                19                         Versata Dev. Group, Inc., CBM2012–00001,
                                20                         Paper 36 (January 9, 2013).
                                21                                 (B)         SCOPE           OF        PRIOR        ART.—Section

                                22                         18(a)(1)(C)(i) of the Leahy-Smith America In-
                                23                         vents Act is amended by striking ‘‘section
                                24                         102(a)’’ and inserting ‘‘subsection (a), (d), or
                                25                         (e) of section 102’’.


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                                  1                                (C) EFFECTIVE                  DATE.—Subparagraph                   (A)
                                  2                        and the amendment made by subparagraph (B)
                                  3                        shall take effect on the date of the enactment
                                  4                        of this Act and shall apply to any proceeding
                                  5                        pending on, or filed on or after, such date of
                                  6                        enactment.
                                  7                        (3) AUTHORITY                    TO WAIVE FEE.—Subject                        to
                                  8               available resources, the Director may waive payment
                                  9               of a filing fee for a transitional proceeding described
                                10                under section 18(a) of the Leahy-Smith America In-
                                11                vents Act (35 U.S.C. 321 note).
                                12                (f) CLARIFICATION OF LIMITS ON PATENT TERM AD-
                                13         JUSTMENT.—

                                14                         (1) AMENDMENTS.—Section 154(b)(1)(B) of
                                15                title 35, United States Code, is amended—
                                16                                 (A) in the matter preceding clause (i), by
                                17                         striking ‘‘not including—’’ and inserting ‘‘the
                                18                         term of the patent shall be extended 1 day for
                                19                         each day after the end of that 3-year period
                                20                         until the patent is issued, not including—’’;
                                21                                 (B) in clause (i), by striking ‘‘consumed by
                                22                         continued examination of the application re-
                                23                         quested by the applicant’’ and inserting ‘‘con-
                                24                         sumed after continued examination of the appli-
                                25                         cation is requested by the applicant’’;


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                                                                                           46
                                  1                                 (C) in clause (iii), by striking the comma
                                  2                        at the end and inserting a period; and
                                  3                                 (D) by striking the matter following clause
                                  4                        (iii).
                                  5                        (2) EFFECTIVE                   DATE.—The            amendments made
                                  6               by this subsection shall apply to any patent applica-
                                  7               tion or patent that is pending on, or filed on or
                                  8               after, the date of the enactment of this Act.
                                  9               (g) CLARIFICATION OF JURISDICTION.—
                                10                         (1) IN       GENERAL.—The                     Federal interest in pre-
                                11                venting inconsistent final judicial determinations as
                                12                to the legal force or effect of the claims in a patent
                                13                presents a substantial Federal issue that is impor-
                                14                tant to the Federal system as a whole.
                                15                         (2) APPLICABILITY.—Paragraph (1)—
                                16                                  (A) shall apply to all cases filed on, after,
                                17                         or pending on, the date of the enactment of this
                                18                         Act; and
                                19                                  (B) shall not apply to a case in which a
                                20                         Federal court has issued a ruling on whether
                                21                         the case or a claim arises under any Act of
                                22                         Congress relating to patents or plant variety
                                23                         protection before the date of the enactment of
                                24                         this Act.
                                25                (h) TECHNICAL CORRECTIONS.—


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                                                                                          47
                                  1                        (1) NOVELTY.—
                                  2                                (A) AMENDMENT.—Section 102(b)(1)(A)
                                  3                        of title 35, United States Code, is amended by
                                  4                        striking ‘‘the inventor or joint inventor or by
                                  5                        another’’ and inserting ‘‘the inventor or a joint
                                  6                        inventor or another’’.
                                  7                                (B) EFFECTIVE                      DATE.—The           amendment
                                  8                        made by subparagraph (A) shall be effective as
                                  9                        if included in the amendment made by section
                                10                         3(b)(1) of the Leahy-Smith America Invents
                                11                         Act (Public Law No. 112–29).
                                12                         (2) INVENTOR’S                 OATH OR DECLARATION.—

                                13                                 (A) AMENDMENT.—Subsection (g)(1) of
                                14                         section 115 of title 35, United States Code, is
                                15                         amended—
                                16                                         (i) by striking ‘‘claims the benefit’’
                                17                                 and inserting ‘‘is entitled, as to each inven-
                                18                                 tion claimed in the application, to the ben-
                                19                                 efit’’; and
                                20                                         (ii) in subparagraph (A), by striking
                                21                                 ‘‘meeting the requirements of subsection
                                22                                 (a) was executed by the individual and was
                                23                                 filed in connection with the earlier-filed ap-
                                24                                 plication’’ and inserting the following: ‘‘ex-
                                25                                 ecuted by or on behalf of the individual


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                                                                                          48
                                  1                                was filed in connection with the earlier-
                                  2                                filed application and meets the require-
                                  3                                ments of this section as effective on the
                                  4                                date such oath or declaration was filed’’.
                                  5                                (B) EFFECTIVE                      DATE.—The           amendment
                                  6                        made by subparagraph (A) shall be effective as
                                  7                        if included in the amendment made by section
                                  8                        4(a)(1) of the Leahy-Smith America Invents
                                  9                        Act (Public Law No. 112–29).
                                10                         (3) ASSIGNEE              FILERS.—

                                11                                 (A) BENEFIT                 OF EARLIER FILING DATE;

                                12                         RIGHT OF PRIORITY.—Section                             119(e)(1) of title
                                13                         35, United States Code, is amended, in the first
                                14                         sentence, by striking ‘‘by an inventor or inven-
                                15                         tors named’’ and inserting ‘‘that names the in-
                                16                         ventor or a joint inventor’’.
                                17                                 (B) BENEFIT                 OF EARLIER FILING DATE IN

                                18                         THE UNITED STATES.—Section                               120 of title 35,
                                19                         United States Code, is amended, in the first
                                20                         sentence, by striking ‘‘names an inventor or
                                21                         joint inventor’’ and inserting ‘‘names the inven-
                                22                         tor or a joint inventor’’.
                                23                                 (C) EFFECTIVE                      DATE.—The          amendments
                                24                         made by this paragraph shall take effect on the
                                25                         date of the enactment of this Act and shall


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                                                                                          49
                                  1                        apply to any patent application, and any patent
                                  2                        issuing from such application, that is filed on or
                                  3                        after September 16, 2012.
                                  4                        (4) DERIVED             PATENTS.—

                                  5                                (A) AMENDMENT.—Section 291(b) of title
                                  6                        35, United States Code, is amended by striking
                                  7                        ‘‘or joint inventor’’ and inserting ‘‘or a joint in-
                                  8                        ventor’’.
                                  9                                (B) EFFECTIVE                      DATE.—The           amendment
                                10                         made by subparagraph (A) shall be effective as
                                11                         if included in the amendment made by section
                                12                         3(h)(1) of the Leahy-Smith America Invents
                                13                         Act (Public Law No. 112–29).
                                14                         (5) SPECIFICATION.—Notwithstanding section
                                15                4(e) of the Leahy-Smith America Invents Act (Pub-
                                16                lic Law 112–29; 125 Stat. 297), the amendments
                                17                made by subsections (c) and (d) of section 4 of such
                                18                Act shall apply to any proceeding or matter, that is
                                19                pending on, or filed on or after, the date of the en-
                                20                actment of this Act.
                                21                         (6) PATENT             OWNER RESPONSE.—

                                22                                 (A) CONDUCT                        OF   INTER        PARTES        RE-

                                23                         VIEW.—Paragraph                     (8) of section 316(a) of title
                                24                         35, United States Code, is amended by striking




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                                                                                          50
                                  1                        ‘‘the petition under section 313’’ and inserting
                                  2                        ‘‘the petition under section 311’’.
                                  3                                (B) CONDUCT                 OF POST-GRANT REVIEW.—

                                  4                        Paragraph (8) of section 326(a) of title 35,
                                  5                        United States Code, is amended by striking
                                  6                        ‘‘the petition under section 323’’ and inserting
                                  7                        ‘‘the petition under section 321’’.
                                  8                                (C) EFFECTIVE                      DATE.—The          amendments
                                  9                        made by this paragraph shall take effect on the
                                10                         date of the enactment of this Act.
                                11                         (7) INTERNATIONAL                     APPLICATIONS.—

                                12                                 (A) AMENDMENTS.—Section 202(b) of the
                                13                         Patent Law Treaties Implementation Act of
                                14                         2012 (Public Law 112–211; 126 Stat. 1536) is
                                15                         amended—
                                16                                         (i) by striking paragraph (7); and
                                17                                         (ii) by redesignating paragraphs (8)
                                18                                 and (9) as paragraphs (7) and (8).
                                19                                 (B) EFFECTIVE                      DATE.—The          amendments
                                20                         made by subparagraph (A) shall be effective as
                                21                         if included in title II of the Patent Law Trea-
                                22                         ties Implementation Act of 2012 (Public Law
                                23                         112–21).




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                                                                                          51
                                  1        SEC. 10. EFFECTIVE DATE.

                                  2               Except as otherwise provided in this Act, the provi-
                                  3 sions of this Act shall take effect on the date of the enact-
                                  4 ment of this Act, and shall apply to any patent issued,
                                  5 or any action filed, on or after that date.




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